|Banking’s image: “Main Street, we have a problem” (April 2011)|
Traditional banks continue to suffer from a barrage of bad publicity. Now there’s a strategy to reclaim the industry’s rightful place in the public’s perception. Includes exclusive results of ABA consumer focus groups.
Three years of bank-bashing have left traditional banks frustrated at their sagging image. Something needs to be done…and it is
By Bill Streeter, editor-in-chief
Lawyer jokes used to have a lock on the market. Not anymore. Type “banker jokes” on Google and you’ll find plenty to choose from, including this one:
Q. What’s the problem with banker jokes?
A. Bankers don’t think they’re funny; normal people don’t think they’re jokes.
Lawyers might tell bankers to just get over it. Easy for them to say. Congress is run by lawyers.
If it was just about jokes, bankers would get over it. But the jokes are a symptom of a much more serious issue—the sharp decline in how the public regards banking. This decline was clearly made worse by the financial crisis that the vast majority of traditional banks had no part in causing. During the crisis, “banking” was redefined by the media and policymakers to include mortgage brokers, Wall Street investment banks, and even AIG. Combine this with the TARP “bailout”—which was anything but—and there has been blood in the water for banks ever since. The overreaching Dodd-Frank Act is the most glaring example of how misinformation can drive bad public policy.
As he took office last October, ABA Chairman Steve Wilson, CEO of LCNB National Bank, Lebanon, Ohio, was deeply disturbed by this trend. He was frustrated that people generally aren’t aware of, or don’t understand, what traditional banks do to help people and support their communities. He made it a primary goal of his term to repair banking’s damaged reputation and to help restore the industry to the position of honor it once held. As he said, “We stand a far better chance of winning in the political arena when we are also winning in the arena of public opinion.”
From the ground up
Wilson established an ABA Image Task Force to determine how best to tackle the challenge. Led by co-chairs Matt Williams, ABA’s vice-chairman, and president of Gothenburg (Neb.) State Bank, and Bick Weissenrieder, CEO of The Hocking Valley Bank, Athens, Ohio, the task force has been meeting monthly since November, in concert with ABA staff, led by Executive Vice-President of Communications, Ginny Dean. Committee members include a mix of bankers, state association executives, and a media representative (this writer).
The group determined that the best approach would be to begin locally, and the place to start was with bank employees.
“Do we know how our employees respond when asked a question about our bank or about the industry?” Matt Williams asked during a presentation at ABA’s recent Government Relations Summit. “Do they look down at their shoes or shrug their shoulders—or do they talk with a sense of pride?” Each employee, he said, can be an ambassador for the bank and the industry if he or she is informed and feels the same pride in their profession that bank presidents do. Employees can be very effective at helping to correct misinformation in their circle of family and friends, and with customers, said Williams. Bank directors can do likewise.
Altogether, the task force identified five target audiences:
1. Employees and directors
3. The community
With input from the task force and from several consumer focus groups, Dean pulled together ABA’s resources to craft a toolbox that member banks can use to take an active role in rebuilding banking’s image. The toolbox is available to ABA members on aba.com. Highlights appear above.
Find out what people think
To move the image needle, the task force recognized that it’s critical to have an idea of what the public’s perception of banking really is. The focus groups were part of that. In addition, the toolbox contains sample surveys for banks to give to employees and customers. The surveys, which can be tailored by each bank, should identify problem areas that then can be addressed. Among the issues probed:
• How prepared do employees feel to address questions about the bank or the industry?
• In their opinion, does the bank’s management act with integrity?
• Does the bank act in the best interests of its customers?
What is needed
“For the ABA image effort to succeed,” said Matt Williams, “two things have to happen”:
The bank’s CEO has to make a dedicated commitment to be an ongoing part of it; and
The CEO has to select a “go-getter” in the bank with the right skills to head up the effort.
“If we sit back and say, ‘We’re all right, it’s not our problem,’ and leave it up to someone else,” said Williams, “nothing will change.” •
They said that? Takeaways from ABA consumer focus groups
Focus groups are always enlightening and frequently jarring. ABA conducted four of them earlier this year to explore consumer perceptions about banks. Below are some typical observations.
Whose fault? When asked who was responsible for the financial crisis, the answer was “everyone.” Banks, the government, predatory lenders, ratings agencies, consumers who made poor choices.
Big vs. small Consumers drew a distinction between big banks and community banks—although they weren’t sure how many community banks still exist—and between banking and Wall Street, although the line was blurry.
Not sure what you do They favor banks’ involvement in the community and economic development, but know little about the extent to which it’s currently done.
Regs not being enforced Most do not understand how, and the extent to which, banks are regulated, although they believe that existing regulation isn’t being enforced, as shown by the recent financial crisis.
Make a profit, but not too much Banking is a commodity to most people. They want it to work and, while they believe that banks are entitled to make a profit, they don’t want the fees to be unreasonable.
Don’t whine People generally do not want to hear banks complain about regulation. It sounds self-serving and whiny.
“Telling Your Bank’s Story”
Here’s some of what’s in the new ABA toolbox for members on aba.com
• Sample letters to employees, directors
• Surveys for employees and customers
• Q&A for addressing customer questions
• Case studies of successful bank programs
• Impact statement form to help quantify banks’ community support (loans, charitable contributions, volunteer work, taxes paid, etc.)
• Speech and PowerPoint presentation for community meetings
• Focus group instructions
• Op-Ed article
• Tips for working with the media
• Media talking points
• ABA resources
The electronic version of this article available at: http://www.nxtbook.com/nxtbooks/sb/ababj0411/index.php?startid=38
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